- The US dollar bounces up at 1.3150 and reaches session highs at 1.3190.
- The greenback appreciates as market sentiment deteriorates.
- On the upside, the USD might find resistance at 1.3200.
The US dollar has bounced at 1.3150 area during the early US session on Monday to regain all the ground lost previously and returning to the upper level of 1.3100.
The US dollar appreciates as market sentiment deteriorates
The Canadian dollar opened the week on a strong footing buoyed by positive market sentiment and pushed its US counterpart to session lows at 1.3150. Comments by House Representative Nancy Pelosi during the weekend, suggesting the possibility of a fiscal stimulus deal in the US and the drugmaker Pfizer affirming that a COVID-19 vaccination would be available before year-end boosted investor’s sentiment, favouring risk-sensitive currencies like the CAD.
Optimism, however, has been short-lived and the sentiment deteriorated as recent reports cooled expectations of an imminent stimulus deal. Beyond that, US Secretary of State, Mike Pompeo has announced further sanctions to China and Hong Kong for issues related with Iran’s shipping lines, which has increased market fears.
USD/CAD might find resistance at 1.3200
On the upside, the pair might find resistance at the 50-day SMA, now at 1.3200. Above here, next resistance would be at 1.3250 (October, 15 high) and 1.3340 (October 7 high and 100-day SMA). On te downside, immediate support lies at 1.3150 (session low). Below here, the pair might increase bearish momentum aiming to 1.3100 (October 12 low) and 1.3045 (September 4 low).
Key levels to watch
Share
